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ARTICLE · 28 APRIL 2022

Further Developments In Mezzanine Foreclosures - April 26, 2022

Hogan Lovells Cadwalader
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The New York State Supreme Court, New York County Commercial Division (the "Court") decided in U.S. Bank, N.A. v. 342 Property LLC, on February 14, 2022, that a mezzanine lender that...

United StatesFinance and Banking
Steven Herman
Steven Herman
Jose Oropeza
Jose Oropeza
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The New York State Supreme Court, New York County Commercial Division (the "Court") decided in U.S. Bank, N.A. v. 342 Property LLC,1 on February 14, 2022, that a mezzanine lender that is not a party to loan documents that evidence a concurrent mortgage loan does not have standing and, therefore, no basis, to preclude a mortgage lender's motion for summary judgement in a foreclosure action against a mortgage borrower that is an affiliate of a mezzanine borrower.

Background

342 Property LLC (the "Mortgage Borrower") received a $40,000,000.00 mortgage loan (the "Mortgage Loan") secured by real property located in New York State and the hotel located thereon (collectively, the "Property").  The Loan was evidenced by a mortgage, promissory note, and other loan documents governed by New York law (the "Mortgage Loan Documents") in favor of U.S. Bank National Association, as trustee for Mortgage Stanley Capital I Inc. (the "Mortgage Lender"), by assignment from a

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